Daily Times

The World Economic Forum (WEF) holds a meeting every year of all those who matter in business, economics and politics, and debates the direction of the world in the coming year. For 2015, the theme was ‘In the global context’. While 2014 was a tough year with slow growth, outbreaks of Ebola and high costs of energy, 2015 has been predicted as a year of higher growth, a more robust financial sector and lower costs of production due to falling oil prices. The BRIC countries (Brazil, Russia, China, India) remained outstanding for weathering economic storms better than the EU and US. The Brazil and Chinese governments are now ready to gear up investments locally and globally, and India, after the change in government, is aggressively wooing and pursuing investment from countries all around the globe. Where in this context is Pakistan and how does it need to position itself to overcome the danger of being left out of the global context?

Pakistan has been ideally placed for the last so many years to take advantage of the shifting global interest. Southeast Asian countries have long become mature in terms of growth and market dynamics as well as labour costs. The natural spillover of investment is South Asia. While the rest of the world is growing at hardly 3.5 percent, South Asia is growing at six percent with countries like India and Bangladesh projected to grow seven percent plus in the coming few years. This makes them an automatic choice for investors around the world. However, in this set of choices Pakistan is not in the consideration box of the big players of the world. Foreign investment in Pakistan in the last few years has trickled to insignificance and exports have stagnated at $ 25 billion, which is not really reflective of the potential of this country. A typical example is the usage of GSP Plus status that was awarded by the EU to Pakistan. GSP Plus reduced significantly the duties imposed by EU countries on Pakistani products. This was supposed to bolster the extremely low level of exports by at least 15 percent and add at least $ 1.5 billion to our export receipts. However, the exporters have lamented the lack of availability of gas and electricity and cost escalation as major reasons behind why this opportunity has gone abegging.

This raises the major question of the search for an investment and trade policy that shows the way forward. In the absence of the way forward, there is only one way to go and that is backwards. Considering that the US is a major strategic partner in trade and the war on terror it is amazing how little vision we have of evaluating whether it is a true partnership or just a tag of convenience for Pakistan to show off to the rest of the world or for the US to use as a ploy to make India tentative. While the global context is clearly stating that economies, societies and issues are going to demand more equal treatment to maintain the status of a reasonable player in the world, Pakistan is ensuring exclusion and isolation by marketing itself as a state that can only help itself get back into bygone eras rather than be part of the great opportunity that is coming the way of being in a region that is naturally an heir to the world investment throne.

What is the understanding of a “global context” in terms of our present government? If it means the Prime Minister (PM), with his near and dear, going on foreign tours and making breaking news by being seen with his entourage shaking hands with the who’s who, then Pakistan is heading this global context. With over 20 foreign trips under his belt in almost 18 months he is definitely globetrotting more than any other leader but the question really is what sort of investment these trips have generated. A comparison with the Indian PM is definitely due. Narendra Modi has made about nine trips to foreign countries and has made each trip with a purpose and profit for his country. His trip to the US was extremely important as he needed to change his image of a man inclined towards the non-liberal right and get Obama interested in the country as a strategic partner in trade and the war against terror. He used the card of common distrust against Pakistan on the war against terror and common interest in rejuvenating the US and Indian economies through trade as a great platform for both countries. President Obama has not only come to India but has announced four billion dollars worth of new initiatives aimed at boosting trade and investment ties as well as jobs in India, and has opened up a whole new source of financing for social development ventures in the country through a new Indian Diaspora Investment Initiative. The four billion dollars deals include two billion dollars of leveraged financing for renewable energy investments in India through the US Trade and Development Agency and one billion dollars in loans for small and medium businesses across India through the Overseas Private Investment Corporation (OPIC).

Normally such MoUs are just fancy promises but the seriousness of the commitment was visible when the US president also announced the creation of a high-level US-India strategic and commercial dialogue to monitor progress on the pacts and vision statements laid out by PM Modi and President Obama. The mechanism, he said, would hold the bureaucracies of the two countries accountable for translating the vision of the two leaders into reality.

The sadness of the situation is that not only are we going out of the global context but that we are also going out of the local context. Governor Sarwar’s resignation is symbolic of not just a disagreement on issues but also a disagreement on values. His main reason for resigning was his admission of how overseas Pakistanis, who have invested in land and other areas, feel insecure at the hands of the land mafia who are beyond governance and higher than the law. If diehard overseas Pakistanis feel that their own assets and investments are prone to be taken over by anybody in power or close to power, how can we ever expect foreigners to put a vote of confidence in response to our appeals for Pakistan being part of the next investors shopping destination? Neither is being subservient to the US the solution nor is being anti-US the remedy. What is needed is being pro-Pakistan and protecting the rights and obligations of every citizen living inside and outside this country. What is needed for that is governance independent of the whims and fancies of the government. Without the government being governable themselves, governance will remain an item on the wish list.

The writer is an analyst and columnist and can be reached at andleeb.abbas1@gmail.com